- Some of the largest pharmaceutical and biotech companies started 2020 by increasing U.S. list prices for a range of top-selling medications, despite intense political scrutiny on the industry and its pricing practices.
- Among the drugmakers raising prices are Pfizer, GlaxoSmithKine, Sanofi, Eli Lilly, Teva Pharmaceutical, AbbVie, Bristol-Myers Squibb, Gilead and Biogen, according to Wall Street analysts and media reports.
- Unlike prior years, however, the Jan. 1 price hikes were more tempered, with one research firm putting the median increase taken by large pharmas at 5%, Reuters reported. That would continue a pattern of moderating January list price increases in recent years, declining from an average of 12% in 2014 to 8% in 2018 and 6% in 2019, according to research from Raymond James published in February 2019.
While the pharmaceutical industry has largely refrained from taking double-digit increases in recent years, price hikes remain a central part of drugmakers' business models, due in part to demands from insurers for heftier rebates.
Piper Jaffray analyst Christopher Raymond described Biogen's price hikes, which included a 6% boost for its best-selling multiple sclerosis therapy Tecfidera (dimethyl fumarate), as "meaningful price increases" that signal "business as usual."
Pharma executives have mainly focused these price increases on the their companies' most important drugs. Gilead, for instance, upped list prices on each of its five top-selling HIV drugs by 4.8%. Pfizer, meanwhile, boosted the price on its Prevnar 13 vaccine by 7.3% and its breast cancer drug Ibrance (palbociclib) by 5%.
AbbVie raised the list price of Humira (adalimumab), the world's best-selling drug, by 7.4%, according to Raymond. The biotech did not respond to a request for confirmation on the price increase of Humira, which made nearly $13.7 billion in 2018 U.S. sales and is on pace to top that mark in 2019.
A recent report from the Institute for Clinical and Economic Review, a drug pricing watchdog, found Humira's list price increased by nearly 20% over the past two years.
The group also determined those price bumps were not supported by new clinical evidence, and estimated that Humira's net price — after accounting for rebates and discounts to insurers — increased by about 16% in that timeframe. That finding, in AbbVie's case at least, runs counter to the industry's argument that, despite list price increases, net prices have remained flat due to rising rebate payments.
AbbVie contested that ICER report in a previous statement to BioPharma Dive, calling the nonprofit group's net price calculation "inaccurate."
Humira aside, pharma's case on net prices is supported by data from Iqvia, a consultancy, that showed net prices rose only 0.3% in 2018 across a group of branded drugs, even as list prices rose by 5.5%. Both of those figures are lower than marks set in prior years.
In some drug categories, such as diabetes, rebates can add up to as much as 40% or 50% of the drug's list price. In others like oncology, however, rebating tends to be less.